Wednesday, January 20, 2010

Thought of the Week

This week, the Census Bureau announced that business inventories rose 0.4% in November- a second consecutive increase following 13 months of decline. In 3Q09, the BEA's measure of real private inventories(used in calculating GDP) fell at a breakneck pace of $139.2 billion. Bringing this decline in inventories to a
halt could boost GDP growth by more than 4 percentage points if achieved in one quarter. While data differences ean that this may not be fully realized in 4Q09, the monthly data increase the likelihood that 4Q09 GDP, due out on January 29, will show an economy growing by 5% or more.